AFGHANISTAN ECONOMIC MONITOR - THE WORLD BANK
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AFGHANISTAN ECONOMIC MONITOR
THE WORLD BANK January 25, 2023
The headline CPI inflation continues its downward trend while food and non-food items remain widely available. According to the
official statistics, headline year-on-year (YoY) inflation in November 2022 decelerated to 9.1 percent from its peak of 18.3 percent in July
2022. Both food and non-food segments contributed to this positive outcome. The 3.9 percentage point Y-o-Y decline between November
2022 and December 2022 can be explained by a drop in inflation of fuel (8 percentage points), wheat (5.1 percentage points), sugar (2.7
percentage points), cooking oil (2.2 percentage points), bread (1.5 percentage points), etc. According to the latest data collected by the
Third-Party Monitoring Agent (TPMA), most basic food and non-food commodities remain in the market.
The exchange rate remains substantially stable against major currencies. The AFN has slightly depreciated against the USD (by 1.5
percent), Euro (by 1.2 percent), and Chinese yuan (by 0.2 percent) between end-June and to end of December 2022 but appreciated against
the Pakistan rupee (24.8 percent) and Indian rupee (2.6 percent). The central bank (DAB) is undertaking occasional auctions in the forex
market. However, no data is available on the central bank website to confirm the frequency and auctioned amount. In the absence of regular
market interventions, the ITA continues to exert controls in the foreign exchange market to manage parity and liquidity, such as regulating the
MSP sector and prohibiting foreign currency-denominated domestic transactions. In parallel, the money service providers (MSPs) report some
foreign exchange shortages in the open market.
Cash withdrawals of pre-August 2021 deposits from banks continue to be regulated. While most individual depositors can access their
deposits within the allowed limits, selected financial institutions face difficulties honoring withdrawals. Firms, on the other hand, not only report
accessibility lower than allowed limits, but access to deposits declined further recently. Accordingly, no statutory withdrawal limit is imposed
on deposits made after August 28, 2021.
Civil servants’ salaries are reported to be paid on time for both men and women. Data collected by TPMA also shows that most civil
servants have reported receiving salaries regularly (as reported by 97 percent of the respondents). Moreover, females are reported to be
paid more regularly than males over the last two months. However, they reported the liquidity shortage as one of the significant challenges
in withdrawing salaries and crowding in the branches. Poor staff behavior is another key issue – particularly for female public servants when
they draw their salaries.
Demand for both skilled and unskilled labor has been declining since the beginning of the winter. Heavy snow and cold weather result
in a decline in agriculture, construction, and allied activities in most parts of the country. In parallel, data show a marginal increase in nominal
wages, which, coped with the decrease in inflation, results in a stronger increase in real wages.
Revenue collection in the first nine months of the fiscal year 2022 remains strong. Overall revenue collection reached AFN135.9 billion
(US$ 1.54 billion) between March 22, 2022, and December 21, 2022, in line with 2020 results. Afghanistan continued to rely relatively
heavily on revenue collected at the border — as opposed to inland revenue collection. For example, for the period under discussion, the
taxes at borders reached 58 percent of the total revenue. Revenue from inland sources reached AFN61 billion (US$ 0.7 billion) from March
21 till the end of December 2022, of which non-tax sources contributed the most. Non-tax revenue, comprising mainly revenues from ministries
in administration fees and royalties, contributes 54 percent of total inland revenues, compared to 45 percent in 2021. A rise in coal mining
royalties and fees likely drives the increase in ministries’ revenue.
Export performance remains strong: during Jan – Nov 2022, Afghanistan exported US$1.7 billion worth of goods, compared to US$
0.9 billion and US$ 0.8 billion for the full years 2021 and 2020. Data from customs authorities show that Pakistan (65 percent) and India
(20 percent) are the two main export destinations. Major exports include vegetable products (56 percent), mineral products (28 percent),
and textiles (10 percent) – collectively contributing 94 percent of total exports. Unfortunately, up-to-date import data is unavailable.
However, the Jan-June 2022 data shows that Afghanistan imported USD 2.9 billion of goods. Of the total imports, Iran (23 percent), Pakistan
(16 percent), and China (14 percent) were the main import origins. Major imports include mineral products (24 percent), vegetable products
(20 percent), and textiles (9 percent) – collectively contributing 54 percent of total imports.
New addition – Health Service Delivery indicators
The Bank financed Health Emergency Response project provides critical mother & child related health services. The data collected by
the TPMA shows that the twenty-three hundred supported facilities received around 3.3 million antenatal visits and provided 691,234
assisted births in 2022. Also, according to third-party monitoring data, 98% of health facilities had a female health worker present during
verification visits between July and October 2022.
Issue #1/2023 THE WORLD BANK1. PRICE CHANGES AND AVAILABILITY OF BASIC HOUSEHOLD GOODS
The headline inflation has been easing since July 2022, helped by lower global oil and food prices and a
stable exchange rate.
1.1. CONSUMER PRICE INDEX 1.2. HEADLINE INFLATION Y-O-Y INFLATION
180.0 30
Over CPI Index Food Non-Food Headline inflation Food Non-food
170.0 25
160.0 20
150.0 15
Percent
140.0 10
130.0 5
120.0 0
110.0
-5
100.0
-10
Jan-19
Jan-20
Jan-21
Jan-22
May-19
May-20
Sep-20
Mar-21
May-21
May-22
Mar-19
Sep-19
Nov-19
Mar-20
Sep-21
Sep-22
Nov-20
Nov-21
Mar-22
Nov-22
Jul-19
Jul-20
Jul-21
Jul-22
Jan-19
May-19
May-22
Sep-22
Sep-19
Jan-20
May-20
Sep-20
Jan-21
May-21
Mar-21
Sep-21
Jan-22
Mar-19
Nov-19
Mar-20
Nov-20
Nov-21
Mar-22
Nov-22
Jul-19
Jul-20
Jul-21
Jul-22
Source: NSIA.
1.3. BASIC HOUSEHOLD GOODS – Y-O-Y INFLATION
Jan- Feb- Mar- Apr- May- Jun- Aug- Sep- Oct- Nov- Dec-
Jul-22
22 22 22 22 22 22 22 22 22 22 22
Bread 10.2 11.6 12.0 14.9 18.1 22.0 23.2 23.3 21.6 19.1 18.1 16.6
Fuel (diesel) 95.1 68.8 73.2 57.3 66.3 95.3 112.5 54.5 87.4 49.1 34.1 26.3
Oil (cooking) 62.3 47.3 43.9 46.4 50.3 51.3 32.3 16.1 0.8 -13.3 -12.2 -14.4
Pulses 28.7 27.6 24.1 23.8 22.9 23.7 23.3 17.7 16.1 11.6 10.6 10.6
Rice (high quality) 18.8 21.9 19.8 19.3 24.0 34.2 37.8 32.9 32.0 28.9 27.2 26.4
Rice (low quality) 14.3 10.1 9.6 7.9 9.6 14.6 13.1 10.9 14.1 12.5 18.5 21.9
Salt 30.2 25.2 23.4 18.9 21.3 22.9 19.0 18.0 16.0 17.8 10.8 20.0
Sugar 35.3 27.1 24.7 24.4 26.0 33.9 37.0 30.9 20.5 8.7 3.9 1.2
Wheat 40.2 31.0 27.8 35.5 40.3 58.1 49.8 43.5 37.9 19.1 16.8 11.8
Wheat flour (high quality) 42.2 27.6 31.6 44.0 50.5 65.1 49.4 41.7 31.9 12.3 12.1 5.8
Wheat flour (low quality) 45.1 32.3 32.1 44.7 52.7 68.2 50.8 41.5 36.0 14.3 13.4 6.5
Basic Household Goods Price Inflation 42.5 32.0 32.2 36.6 41.6 51.7 43.4 31.5 26.4 11.1 9.9 6.1
Source: Price data from WFP weekly report; index constructed by World Bank staff.
Note: This Index uses WFP price data for 11 critical household goods from all provinces. It applies consumption and population weights from NSIA to provide an
aggregate snapshot of basic household inflation trends.
Data from 48 markets in 21 provinces suggest that most basic food and non-food items remain available.
1.4. REPORTED AVAILABILITY OF FOOD & NON-FOOD ITEMS
100% Food Non-food 99% 99%
99% 99% 99%
98% 98% 98% 98% 98%
98% 98%
98%
97%
96% 96% 96%
95% 96% 96%
96% 95% 95%
93% 94%
94% 93%
93% 93% 93%
92%
92%
90%
88%
Nov-21 Dec-21 Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22
Source: Survey data collected by the World Bank’s Third-Party Monitoring Agent.
Issue #1/2023 THE WORLD BANKAFGHANISTAN ECONOMIC MONITOR
2. LABOR MARKET CONDITIONS
Nominal and real wages slightly increased in December 2022.
2.1. NOMINAL AND REAL WAGES (AFN) FOR SKILLED AND UNSKILLED WORKERS
Nominal Wage(unskilled labour) Nominal Wage (Skilled labour) Nominal Wage(unskilled labour) Nominal Wage (Skilled labour)
700.0
Real wage (unskilled labour) Real wage (skilled labour)
700
600.0
600
500.0
400.0 500
300.0 400
200.0 300
100.0 200
0.0 100
Jul-21
Jul-22
Jan-22
May-22
Oct-21
Jun-21
Aug-21
Nov-21
Jun-22
Apr-22
Aug-22
Nov-22
Dec-21
Oct-22
Dec-22
Mar-22
Sep-21
Feb-22
Sep-22
May-21
Jul-21
May-22
Jul-22
Nov-21
Jan-22
Jun-21
Aug-21
Apr-22
Aug-22
Nov-22
Oct-21
Dec-21
Jun-22
Oct-22
Dec-22
Mar-22
Sep-21
Feb-22
Sep-22
Source: Wage data from WFP, World Bank staff elaboration. Real wages are calculated using price data from the NSIA. Inflation data for December 2022 is
projected. Note: Real wages to January 2022 are calculated based on CPI inflation reported by NSIA.
Demand for skilled and unskilled labor declined as construction and other allied activities slowed down due to
the winter.
2.2. LABOR DEMAND FOR SKILLED AND NON-SKILLED WORKERS BETWEEN NOVEMBER 2021 AND DECEMBER 2022
3.0 Demand for Skilled Labor Demand for Un-skilled labor
2.5 2.6 2.5 2.6
2.5 2.4 2.3 2.3
2.3
2.2 2.1 2.1 2.2
2.1
2.0 2.1 2.1 2.1 2.1 2.1 2.1 2.0
1.9 1.9 2.0
2.0 1.8 1.9
1.7
1.6
1.5
1.0
0.5
0.0
Nov-21 Dec-21 Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22
Source: Survey data collected by the World Bank’s Third-Party Monitoring Agent. Data for June 2022 was not collected.
Note: Data for June 22 is not available.
Note: Data reflects the number of available workdays reported by skilled and unskilled casual workers seeking work. Skilled workers include (i) carpenters, (ii)
electricians, (iii) masons, (iv) painters, (v) plumbers, and (vi) tile workers. Data for June 2022 was not collected.
THE WORLD BANK 3AFGHANISTAN ECONOMIC MONITOR
3. REVENUES
The ITA collected AFN135.9 billion in the first nine months of the fiscal year 2022—with a higher share coming
from taxes collected at borders and non-tax sources.
3.2 SHARE OF INLAND & CUSTOMS REVENUES IN TOTAL
3.1. TOTAL REVENUE COLLECTION—CUMULATIVE (AFN BILLIONS)
COLLECTIONS
2020 2021 2022
200
160
ARD, 42%
120
80
40
0 ACD,
58%
M6 - Sunbula
M2 - Sawr
M8 - Aqrab
M9 - Qaws
M4 - Saratan
M3 - Jawza
M5 - Asad
M7 - Meezan
M1 - Hamal
Source: Ministry of Finance., Note: The Afghan fiscal calendar month, Hamal, runs from March 21-April 20.
3.2. REVENUE COLLECTED AT THE BORDER (AFN BILLION) 3.3 PERCENT SHARE OF COLLECTIONS AT BORDER CROSSINGS
Tajikistan, Others, 1%
Avg 2022 Avg 2021 Avg 2020 1%
12 Turkmenistan,
Avg 2022 Avg 2021 Avg 2020
10 Uzbekistan,
10%
8
6
Iran, 14% Pakistan,
52%
4
2
0
Sawr
Qaws
Saratan
Aqrab
Jawza
Meezan
Asad
Sunbula
Hamal
M5 -
M2 -
M9 -
Iran - Turkmenistan,
M8 -
M1 -
M3 -
M6 -
M4 -
M7 -
17%
3.4 INLAND REVENUE COLLECTION (AFN BILLIONS) 3.5 PERCENT SHARE OF ARD COLLECTIONS FROM SOURCES
2022 2021 2020 STO Audit Dept
20 3% 2%
Avg 2022 Avg 2021 Avg 2020
18
16
Mustofiats
14 15%
12
10
8
Ministries
6 54%
4
2 Tax Servics
0 Department,
M1 - M2 - M3 - M4 - M5 - M6 - M7 - M8 - M9 - 26%
Hamal Sawr Jawza Saratan Asad Sunbula Meezan Aqrab Qaws
Source: Ministry of Finance.
THE WORLD BANK 4AFGHANISTAN ECONOMIC MONITOR
4. FOREIGN EXCHANGE AND FINANCIAL MARKET OPERATIONS
The average exchange rate AFN/USD for 2022 was 89.9, compared to 84.5 in 2021—a 6 percent
depreciation on average.
4.1. EXCHANGE RATE - INDEX JULY 2021 (HIGHER = DEPRECIATION)
AFN/Euro AFN/PKR AFN/INR AFN/IRT AFN/USD AFN/CY
160
140
120
100
80
60
12/31/2022
10/23/2021
11/20/2021
12/18/2021
10/22/2022
11/19/2022
12/17/2022
1/15/2022
4/23/2022
7/31/2021
8/14/2021
8/28/2021
9/11/2021
9/25/2021
10/9/2021
11/6/2021
12/4/2021
1/1/2022
1/29/2022
2/12/2022
2/26/2022
3/12/2022
3/26/2022
4/9/2022
5/7/2022
5/21/2022
6/4/2022
6/18/2022
7/2/2022
7/16/2022
7/30/2022
8/13/2022
8/27/2022
9/10/2022
9/24/2022
10/8/2022
11/5/2022
12/3/2022
4.2. EXCHANGE RATE – DEPRECIATION BY CURRENCY SINCE AUGUST 15, 2021
1-Feb- 28-Feb- 31-Mar- 27-Apr- 29-May- 29-Jun- 28-Jul- 30-Aug- 29-Sep- 27-Oct- 30-Nov- 31-Dec-
22 22 22 22 22 22 22 22 22 22 22 22
AFN/Eur -12.66 -5.41 -0.14 4.17 1.71 4.16 6.65 9.62 14.13 11.61 7.22 2.95
AFN/PKR -7.62 0.35 3.98 8.38 12.28 18.88 40.73 24.25 33.15 38.25 40.19 48.18
o
AFN/INR -4.25 7.63 9.53 11.41 9.55 10.55 9.05 11.23 12.50 13.26 15.18 13.41
AFN/IRT -13.51 -11.11 -8.57 -3.03 0.00 10.34 10.34 10.34 10.34 23.08 23.08 33.33
AFN/US$ -14.45 -6.16 -2.68 0.22 -3.38 -1.87 -3.98 -2.35 -2.36 -2.03 -2.61 -3.37
AFN/CY -14.72 -6.38 -4.59 2.33 -6.06 -0.32 -2.33 -1.22 2.80 1.65 2.40 -0.50
D
Source: Data from DAB, World Bank staff elaboration.
Money service providers continue to report some foreign currency shortages.
4.3. AVAILABILITY OF FOREIGN EXCHANGE ACCORDING TO MONEY SERVICE PROVIDERS
Adequate Limited Unavailable
100%
80%
60%
40%
20%
0%
UAE Dirhams
UAE Dirhams
UAE Dirhams
UAE Dirhams
UAE Dirhams
UAE Dirhams
UAE Dirhams
UAE Dirhams
UAE Dirhams
UAE Dirhams
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
US Dollars
Iranian Tomans
Pakistani Rupees
Pakistani Rupees
Pakistani Rupees
Pakistani Rupees
Pakistani Rupees
Pakistani Rupees
Pakistani Rupees
Pakistani Rupees
Pakistani Rupees
Pakistani Rupees
March April May June July August September October November December
Source: Survey data collected by the World Bank’s Third-Party Monitoring Agent by visiting 144 MSPs in 48 markets in the country.
Note: Includes banks, hawala operators, and informal currency exchangers.
THE WORLD BANK 5AFGHANISTAN ECONOMIC MONITOR
Firms still cannot withdraw AFN and US$ from pre-August bank deposits. However, the situation is much better
for individuals, as most banks can service their clients.
4.4. WEEKLY WITHDRAWALS - FIRMS (AFN MILLIONS) 4.5. WEEKLY WITHDRAWALS – FIRMS (USD)
Reported amount able to be withdrawn in Million AFS Reported amount able to be withdrawn in USD
Regulated limit in AFS Regulated limit in USD
3.0 30,000
2.5 25,000
2.0 20,000
1.5 15,000
1.0
10,000
0.5
5,000
0.0
-
July
February
August
January
October
March
April
June
November
May
December
September
December
July
January
August
October
February
March
April
June
November
May
December
December
September
4.6. MONTHLY WITHDRAWALS - INDIVIDUALS (AFN MILLIONS) 4.7. MONTHLY WITHDRAWALS – INDIVIDUALS (USD)
Reported amount able to be withdrawn in AFS Reported amount able to be withdrawn in USD
Regulated limit in AFS Regulated limit in USD
30,000 400
25,000 350
300
20,000 250
15,000 200
150
10,000
100
5,000 50
0 0
July
February
January
April
August
March
October
November
May
June
December
September
December
July
February
August
January
April
October
November
March
May
June
December
December
September
4.8. AVERAGE MONTHLY WITHDRAWAL – INDIVIDUAL (AFS)
Source: Survey data collected by the World Bank’s Third-Party Monitoring Agent.
Note: Regulated limit as stipulated by DAB. Reported amount able to be withdrawn as reported by individual respondents to the Third-Party Monitoring Agent
survey.
THE WORLD BANK 6AFGHANISTAN ECONOMIC MONITOR
Cash and bank accounts are the two most common means to receive salary payments. However, female civil
servants also mentioned Hawala as a key mode of salary payment.
4.9. MODE OF SALARY PAYMENT (2165 RESPONDENTS) 4.10. COMPOSITION OF MODE OF PAYMENT (BY GENDER)
Bank Account In Cash
Male Female
In Cash & Bank Account Bank Account & Hawala
Hawala Mobile Money Operator (MMO)
100% 91%
87%
90%
0.9% 0.0%
0.2% 80%
70%
1.2%
10.9% 60%
50%
40%
30%
20% 11%
10% 5% 5% 1.5%
1% 0.0%
0%
86.8% Bank Account In Cash Hawala Others
The key challenges when withdrawing salaries are crowding in branches and the liquidity shortage. Poor staff
behavior is another key issue – particularly in the case of females.
4.11. CHALLENGES FACED WHEN WITHDRAWING SALARIES
Crowding at the bank
80% Male Female
Lack of funds at the bank
Crowding and lack of funds at the bank 70%
Damaged or old notes provided 60%
Crowding at the bank and Damaged or old notes provided 50%
Others 40%
Dec-22
30%
Nov-22 20%
Oct-22 10%
Sep-22 0%
Damaged or old notes
Crowding at the bank and
Lack of funds at the bank
Crowding at the bank
Others
Crowding and lack of
Poor bank staff behaviour
Aug-22
Damaged or old notes
funds at the bank
Jul-22
Jun-22 provided
provided
May-22
Apr-22
Mar-22
0% 20% 40% 60% 80% 100%
Since the beginning of 2022, salaries for all civil servants have been paid regularly and in most cases.
Moreover, females are reported to be paid more regularly than males over the last two months.
4.12. CIVIL SERVANTS RECEIVED SALARIES DURING THE LAST 4.13. MALE VS FEMALE RESPONDENTS RECEIVING SALARIES IN
THREE MONTHS THE LAST THREE MONTHS
No, 3% 120% Female Yes (%) Male Yes (%)
100%
80%
60%
40%
Yes, 97% 20%
0%
Aug-22
May-22
Sep-22
Oct-22
Nov-22
Mar-22
Jun-22
Apr-22
Dec-22
Jul-22
Source: Survey data collected by the World Bank’s Third-Party Monitoring Agent.
Note: Data for civil servants for June 2022 is not available.
THE WORLD BANK 7AFGHANISTAN ECONOMIC MONITOR
5. TRADE DEVELOPMENTS
The imports and exports rebounded since Q4-2021 and remained on an upward trajectory in 2022. The
country exhibited strong export performance during 2022.
5.1. AFGHANISTAN’S MAJOR EXPORT DESTINATIONS (2019 – 2022) 5.2. AFGHANISTAN EXPORTS (US$ 1.7 BILLION) - JAN – NOV 2022
2019 2020 2021 2022* Others 109.5
Major Export Destination
1200 Iran 26.9
Tajikistan 34.1
1000 United Arab Emirates 36.7
Uzbekistan 41.9
800 India 339.2
1086.4
USD Million
Pakistan
600
Other 41.5
Base Metals 28.7
400
Major Exports
Prepared Foodstuffs 37.5
200 Textiles 163.1
Mineral Products 470.0
0 Vegetable Products 933.9
Uzbekistan
UAE
Iran
Pakistan
Turkey
Other
India
China
1200.0
200.0
400.0
600.0
1000.0
800.0
0.0
Source: NSIA data. The 2022 data is for 11 months and sourced from customs Source: ASYCUDA.
(ASYCUDA)
6. PROVISION OF HEALTH SERVICES
The Health Emergency Response (HER) project supports critical services at 2300 facilities.
6.1. SERVICES DELIVERED AT 2300 HER FINANCED HEALTH FACILITIES DURING 2022
Ante-natal care visits Births at project facilities
350,000
300,000
250,000
200,000
150,000
100,000
50,000
0
July
August
February
January
April
October
November
March
May
June
December
September
Source: Survey data collected by the World Bank’s Third-Party Monitoring Agent.
THE WORLD BANK 8AFGHANISTAN ECONOMIC MONITOR
Data notes: The Afghanistan Economic Monitor is produced by World Bank staff, drawing from a range of data sources. Reflecting
limited data availability, data sources and coverage may vary between editions. Data sources are cited for each chart. The
Afghanistan Economic Monitor uses data from the following sources: (i) official statistics on prices produced by the NSIA; (ii) data on
prices and wages collected from all provinces by the World Food Program; (iii) data on the availability of foreign exchange and
cash collected from 22 provinces by the World Bank’s Third Party Monitoring Agent; (iv) data on exchange rates collected and
reported by DAB; and (v) data on trade from the NSIA.
For analytical products on Afghanistan, kindly visit https://www.worldbank.org/en/country/afghanistan.
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